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Buffett says 'Buy American'

(Agencies)
Updated: 2008-10-18 13:39

NEW YORK -- Warren Buffett, the world's richest man according to Forbes magazine, said Friday in a newspaper commentary that he is buying US stocks even though the American economy is in a "mess".

Buffett, 78, who has become known as the "Oracle of Omaha" because of his fortune building skills, said he has been buying into US companies even as "fear spreads".

"The financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher," the head of Berkshire Hathaway Inc conglomerate wrote in the New York Times.

Warren Buffett, the world's richest man according to Forbes magazine, said Friday in a newspaper commentary that he is buying US stocks even though the American economy is in a "mess". [Agencies]

"In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary," Buffett added.

"So ... I've been buying American stocks. This is my personal account I'm talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings, which are all committed to philanthropy)."

"If prices keep looking attractive, my non-Berkshire net worth will soon be 100 percent in United States equities."

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The reason, he said, is a key maxim in his outlook: "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.

"Most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation's many sound companies make no sense," Buffett said.

"These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records five, 10 and 20 years from now."

Buffet stressed that he could not predict how the market would ride out its roller-coaster days in the short-term.

But he said "what is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over."

Buffett has supported Democrat Barack Obama in the race for the White House. But both Obama and his Republican rival John McCain say they agree he would make a good treasury secretary.

Buffett, who is noted for his personal frugality despite his huge fortune, has said in the past he believes the financial markets should be more tightly regulated.

According to Forbes magazine's annual wealth list published in March, Buffett saw his worth jump from 52 billion dollars last year to 62 billion, pushing Microsoft co-founder Bill Gates out of first place.